Jon Eisenberg

Prof. Amanda Nicholson

Case 32
11/23/10

In my opinion, customer service has the ability to make or break a shopping

experience and strongly influence whether you shop at a certain store or not. Nordstrom

has had strong customer service values since the beginning of the company. Founder

Johan Nordstrom believed that people were the most important part of the business and

that serving the customer to the best of their ability is correlated with strong sales. This

focus on satisfying people has given Nordstrom’s a competitive advantage over its

competitors.

1. Nordstrom takes many steps to implement their strategy of providing outstanding

customer service. The first step is instructing their employees to do whatever is in the

customer’s best interest. With the customer’s best interest in mind, the employees treat

customer’s like royalty, because who wouldn’t want to be treated like royalty? This step

will help satisfying customers who give them a reason to come back and shop with

Nordstrom if an employee gives them a great, above and beyond, experience.

The next step of providing outstanding customer service is having an inverted

organizational chart pyramid. The pyramid is structured with customers at the top,

followed by salespeople, department managers, general managers, and then the board of

directors. This inverse is important to the company with their strong focus on customer

service because it doesn’t matter how hard a board of directors work because, in the end,

it comes down to sales that come from the customers.

 With the organization chart, salespeople are just below the customer. The

company believes that it needs to treat its employees well so they can provide the best

customer service. This step is important because the company supplies employees with

personalized business cards to build relationships with customers. This is a great practice

because if a customer builds a strong relationship with an employee than the customer

will likely come back to shop with Nordstrom. They focus on salespeople traveling from

department to department, which can require some lengthy training.

The last step of providing outstanding customer service is treating employees

well. If an employee isn’t appreciated and treated well, they won’t work to their full

potential and have little incentive to above and beyond. The ways Nordstrom takes care

of its employees is by promoting employees from within and hiring people with positive

attitudes, initiative, and the ability to handle high expectations.

2. These activities enable Nordstrom to reduce the gaps between perceived service

and customer expectations in many ways. Perceived service is that customers base their

evaluations of store service on their perceptions (Retailing Management). This is judged

on reliability, assurance, tangibles, empathy, and responsiveness. Customer expectations

is anticipating a customers needs before they announce them, and putting those actions

into place.

In chapter 19, the book discusses gaps such as knowledge, standards, delivery,

and communication. This small case shows how it uses activities such as using

customer-focused policies to lessen the gap between the standards gap and customer

expectations. An example is the commitment to service quality. Their stores are focused
on carrying a full selection of merchandise in a wide variety of sizes with an average

Nordstrom store carrying roughly 150,000 pairs of shoes. This commitment will make

customers want to shop with Nordstrom because of the higher chances to find their shoe

size in the store and be able to try it on.

Again in the standards gap is giving information and training. Nordstrom invests

a lot into their employees and expect a lot out of them. The training they receive lessens

the gap by customers feeling more comfortable shopping with the employee. Nobody

wants to shop with an employee that has no knowledge that will help you. A customer

going into Nordstrom has the expectation that their employee could possibly turn into a

personal shopper for them offering insightful knowledge to help them make purchases.

A last activity that lessens the communications gap is to “Never Say No”. With

customer service, if the customer is unhappy with the service then they will likely not

want to come back and shop with you; not to mention tell their friends about their

horrible experience. Teaching this practice of “Never Say No”, makes sure that

employees can go exceed average customer service expectations and go the extra mile for

the customer.

3. There are many pros and cons of Nordstrom’s approach to developing a

competitive advantage through customer service. Some pros are gaining repeat

customers and attracting better employees. Some cons are that it is expensive to train

employees and they can lose money having such a loose return policy.

The first pro of gaining repeat customers through offering above average

customer service is the most important reason a company can stay in business. Without a

loyal customer base, the store will hardly have any shoppers to spend money. The
second pro is attracting better employees. The way Nordstrom treats its employees with

opportunities to get promoted from within will attract better employees. With more

employees applying, there will be a better pool of employees to choose from that will

help with better customer service.

The first con of developing a competitive advantage through customer service is

training costs. When employees acquire further training, they will want more money

when they learn new skills. Along with the demand of raises, it will also cost money to

spend time training the employees. The second con of better customer service is money

lost due to full refunds on any item, including heavily used merchandise. This con could

be argued to be turned into a pro by making customers feel confident in returning an item

that didn’t live up to expectations. The reason that this is a con however, is because there

will be customers that take advantage of this policy and abuse it.

Works Cited:

Levy, Michael, and Barton A. Weitz. Retailing Management. Boston: McGraw-Hill

Irwin, 2009. Print.